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56.820 Construction on state-owned land under built-to-suit lease agreements.

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56.820 Construction on state-owned land under built-to-suit lease agreements. (1) This section shall apply when the built-to-suit process involves the construction of a building on state-owned land. (2) Upon the execution of a lease awarded under this section, the Commonwealth shall convey to the individual or firm to whom such lease has been awarded, in fee <br>simple with covenant of general warranty of title, the real estate upon which the <br>building is to be constructed under this lease. The lease shall provide for an initial <br>lease term commencing on the date the building is accepted for occupancy by the <br>Commonwealth, but not later than thirty (30) days after the owner's architect has <br>certified that construction of the building has been completed, and ending June 30 <br>of the second year of the then current fiscal biennium of the Commonwealth, with <br>an option in the Commonwealth, as lessee, to extend the term of the lease for a term <br>of two (2) years from the expiration of the original term of the lease and for two (2) <br>years from the expiration of each extended term of the lease, until the original term <br>of the lease has been extended for a total number of years to be agreed upon by the <br>parties at a rental which, if paid for the original term and for each of the full number <br>of years for which the term of the lease may be extended, will amortize the total <br>cost of the erection of the building and appurtenances. The rent shall be paid at such <br>times as the parties to the lease agreed upon. The lease shall provide that the lessee <br>may, at the expiration of the original or any extended term, purchase the leased <br>premises at a stated price, which shall be the balance of the total cost of erection of <br>the building and appurtenances not amortized by the payments of rent previously <br>made by the lessee. The lease shall provide that in the event of the exercise of the <br>option to purchase the leased premises or in the event the lease has been extended <br>for the full number of years which it is agreed the same may be extended, and all <br>rents and payments provided for in the lease have been made, the lessor shall <br>convey the premises to the lessee in fee simple with covenant of general warranty of <br>title. The lease may provide that the lessee shall, as additional rent for the leased <br>premises, pay all taxes assessed against the leased premises, and the cost of insuring <br>the building erected thereon against loss or damage by fire and windstorm in such <br>sum as may be agreed by the parties thereto. Effective: July 14, 1992 <br>History: Amended 1992 Ky. Acts ch. 54, sec. 9, effective July 14, 1992. -- Created 1978 Ky. Acts ch. 231, sec. 11, effective June 17, 1978.